Policy:
China has set its GDP growth target at around 6.5% for 2018, premier Li Keqiang told delegates at the annual meeting of the National People’s Congress (NPC) on Monday.
The premier also noted that China will continue the market-oriented reform of the RMB exchange rate, and maintain the RMB’s status in the global monetary system, according to an excerpt of Li’s speech published by the state-owned Xinhua news agency on March 5. China will also maintain a neutral monetary policy and utilise policy tools to ensure the stability of liquidity, said Li.
Trade:
MofCom has condemned US president Donald Trump’s proposal to impose 25% and 10% tariffs on steel and aluminium imports. The move will disrupt international trade and damage multilateral organisations such as the World Trade Organisation, said Wang Hejun, head of the trade remedy and investigation bureau at MofCom.
Wang said Chinese steel and aluminium exports to the US are mainly mid to low-end products, which do not threaten the national security of the US. He urged the US to change course, given the opposition from US businesses, Brazil, Canada, the European Union, South Korea and other countries.
Trump’s announcement came as Liu He, member of the politburo of the Chinese Communist Party, was visiting the US. Liu reaffirmed the Chinese positions on market access and US-China trade balance in discussions with Steve Mnuchin, the treasury secretary, and Gary Cohn, director of the White House national economic council, the Chinese ministry of foreign affairs said in a March 4 announcement. The two sides also agreed to hold further discussions in Beijing in the near future, according to the ministry.
Bonds:
Shanghai Stock Exchange and Shenzhen Stock Exchange published the issuance guidelines for Belt and Road bonds on March 2.
Belt and Road bonds issuers will need to make clear the use of proceeds and any plans to repatriate the proceeds in their application documents. They will also need to acquire the legal opinions of lawyers in China and the issuer’s country of incorporation, respectively, and obtain credit ratings from at least one onshore-based agency.
The two exchanges said they will encourage investors, including foreign investors with qualified foreign institutional investor (QFII) and RMB QFII (RQFII) quotas to invest in Belt and Road bonds.
The guidelines, which came into effect on March 2, cover bonds issued by governments, corporations and financial institutions in Belt and Road countries, and those sold by domestic corporations, the proceeds for which will be used in projects related to the Belt and Road Initiative.
China’s ‘Two Sessions’ — annual meetings of the National People’s Congress and the Chinese People’s Political Consultative Conference — started this weekend. Check GlobalRMB.com later today for a response from analysts and economists on the early hints from the meetings.
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